Nation 1: MexicoGood 1: televisionsNationsGiven: Mexico and Canada produce only two goods. They have the same fixed resourcesare equally efficient and both countries have constant opportunity costs between the twogoods. in one month Mexico can produce 250,000 televisions or 70,000 washing machinesCanada can produce 120,000 televisions or 50,000 washing machines. Fill in the tablebelow.+ MexicoCanadaIMax ProductionNation 2: CanadaA) Graph the given information.Good 2: Washing machinesOpportunity Cost Opportunity Cost B) If the two nations enter a trade agreement, what are the maximum and minimum valuesGood 1 would trade for?C) If the two nations enter a trade agreement, what are the acceptable terms of trade for Good1?D) Give a specific example of a certain amount of good 1 trading for good 2. How much dideach nation profit from entering the trade agreement?ex. France trades 5 apples to Germany for 10 oranges.If France made 10 oranges, it would cost them 20 apples. They only had to give Germany 5apples (instead of 20 apples) for 10 oranges, so they profited by 15 apples.If Germany made 5 apples, it would cost them 17 oranges. They only had to give France 1oranges, so they profited by 7 oranges.

Comparative advantage was propounded by David Ricardo which describes the skill set of an economy to…

Nation 1: Mexico Good 1: televisions Nations Given: Mexico and Canada produce only two goods. They have the same fixed resources are equally efficient and both countries have constant opportunity costs between the two goods. in one month Mexico can produce 250,000 televisions or 70,000 washing machines Canada can produce 120,000 televisions or 50,000 washing machines. Fill in the table below. + Mexico Canada I Max Production Nation 2: Canada A) Graph the given information. Good 2: Washing machines Opportunity Cost Opportunity Cost

Nation 1: Mexico Good 1: televisions Nations Given: Mexico and Canada produce only two goods. They have the same fixed resources are equally efficient and both countries have constant opportunity costs between the two goods. in one month Mexico can produce 250,000 televisions or 70,000 washing machines Canada can produce 120,000 televisions or 50,000 washing machines. Fill in the table below. + Mexico Canada I Max Production Nation 2: Canada A) Graph the given information. Good 2: Washing machines Opportunity Cost Opportunity Cost

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Nation 1: Mexico
Good 1: televisions
Nations
Given: Mexico and Canada produce only two goods. They have the same fixed resources
are equally efficient and both countries have constant opportunity costs between the two
goods. in one month Mexico can produce 250,000 televisions or 70,000 washing machines
Canada can produce 120,000 televisions or 50,000 washing machines. Fill in the table
below.
+ Mexico
Canada
I
Max Production
Nation 2: Canada
A) Graph the given information.
Good 2: Washing machines
Opportunity Cost Opportunity Cost

B) If the two nations enter a trade agreement, what are the maximum and minimum values
Good 1 would trade for?
C) If the two nations enter a trade agreement, what are the acceptable terms of trade for Good
1?
D) Give a specific example of a certain amount of good 1 trading for good 2. How much did
each nation profit from entering the trade agreement?
ex. France trades 5 apples to Germany for 10 oranges.
If France made 10 oranges, it would cost them 20 apples. They only had to give Germany 5
apples (instead of 20 apples) for 10 oranges, so they profited by 15 apples.
If Germany made 5 apples, it would cost them 17 oranges. They only had to give France 1
oranges, so they profited by 7 oranges.

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